Paypal Wants Tax ID

[Chris18181]

Hi Everyone,

I just received this email from Paypal,

Dear XXXXXXXX,

To comply with the Internal Revenue Service's (IRS) rules, we ask that you
submit your Tax ID number to us as soon as possible. Your Tax ID number is
one of these:

- Your Social Security Number (SSN)
- Your Individual Tax Identification Number (ITIN)
- Your Employer Identification Number (EIN)

We are required to obtain tax ID numbers from all online sellers who
receive payments for goods or services through PayPal. If you do not
provide us with your Tax ID number, your account access will be limited,
and you will be unable to request or receive money. After you provide us
your Tax ID number, your account will be fully functional.

Here's how to submit your Tax ID number:

1. Log in to your PayPal account.

2. A message will appear asking you to update your information.

3. Click Provide Now and follow the instructions.

If you have multiple PayPal accounts, repeat these steps for each account.

We'll use your Tax ID number to send tax Form 1099-K to you and the IRS
when the payments you receive meet the 1099-K reporting thresholds for the
calendar year. For more information, please see our FAQs on the IRS
reporting requirements: www.paypal.com/irs.

We appreciate your help in complying with these IRS rules.

Sincerely,
PayPal

would the best way to do this since all my info is stealth, upgrade my Paypal to a business account and create an EIN?

[eyahed]

I seriously just logged into this forum to ask the same question...can anyone please help.

[rsot]

Welcome to the forums.

First best step is to search the forums using keywords "EIN" or "IRS" - many posts cover this.

Best of luck

[GreenBean]

Originally Posted by Chris18181

would the best way to do this since all my info is stealth, upgrade my Paypal to a business account and create an EIN?

That's a good working option, yes.

How old is the account & what's its feedback like?

[Chris18181]

The account is 3 months old now, The 90 day hold should fall off around April 22nd, my feedback score is 50

I am wondering if it would be a good idea to change my Ebay User id to a business name, I am also wondering if i can change my Paypal Account to a business account even though though Paypal is still requesting an EIN.

and then create an EIN under the business name i created

[nghtshd88]

Originally Posted by Chris18181

The account is 3 months old now, The 90 day hold should fall off around April 22nd, my feedback score is 50

I am wondering if it would be a good idea to change my Ebay User id to a business name, I am also wondering if i can change my Paypal Account to a business account even though though Paypal is still requesting an EIN.

and then create an EIN under the business name i created

Just read in a similar thread this works. Believe the EIN is free last I checked.

[Chris18181]

yes the EIN is free, I've did this before, It will be Monday before i can create one, since the IRS is closed on the weekends.

[bjammin]

Look, you cannot just grab an EIN. I think JeffWeico and I have differing opinions about this, but hopefully he can chime in on this. He probably has more experience with this than I do.

From my experience, I use EINs from an LLC Corporation. This is all I have ever used. A corporation is its own entity. So the EIN does not trace back easily to the name behind the business, although if PP was to dig, they could find it. This has not happened yet, nor do I expect it to ever.

My understanding, not my experience, is that a LLC sole proprietorship or LLC partnership will trace back to the individual(s) SSN and could result in problems.

Again, it is always best to consult a tax professional or a lawyer about these types of topics. Sure, it will cost some dough, but if you are hitting that 200 items mark or $20k mark already, then it should be worth the $400 or less to do this the right way.